“Huge Switch” Means Bigger Cuts in Energy Bills on the Horizon

By Leigh Teixeira

Which? a consumer rights group has been taken on by a website which specializes in price comparison. The website – Energyhelpline.com has launched an initiative called Huge Switch which is a collective scheme which will bargain with energy companies in an effort help lower the average household’s energy bills.

Huge Switch is in direct completion with a similar initiative launched by Which? called Big Switch. Almost a quarter of a million people have signed up since its inception in February of this year.

The aim of Big Switch is to use the combined economic bargaining power of energy consumers who have joined to negotiate with energy suppliers so consumers are charged the lowest rates possible. Which? says that more than £4 billion a year was overpaid by UK citizens on their energy bills. This is why they want to help to save money.

Many have criticized the group for not being honest about the potential fees it could earn from the initiative. Five energy companies, including the largest energy supplier in the UK, have refused to take part in it.

Its estimated that with about a quarter of a million people are taking part, Which? could make at least £8 million clear profits. In late March it was confirmed that each customer who joined the initiative would be charged £40. This is basically an admin fee to cover the financial risks involved as well as fund the campaign.

Ecotricity, one of the companies who refused to take part has chosen to do so because they feel that Which? will be making too much money off the campaign. They have also said that this campaign will breach their ethical pricing policies. Consumers who have joined the Big Switch will be a on a different tariff to those who aren’t.

Director of Energyhelpline.com, Mark Todd, has said that Huge switch will prove to be cheaper for consumers and offers some improvements on the Big Switch initiative. Mr. Todd says the company agrees with the concept behind Big Switch although it’s flawed in many ways. He feels that they have come up with a better, flexible and cheaper solution which is more beneficial to the customer.

Energyhelpline.com has stated that they will be charging at least half of what Which? is charging. Customers will also have the choice of the best tariff on the market or they’ll be able to choose the tariff negotiated by Huge Switch. Energyhelpline.com aims to offer customer different tariffs that are tailored for each household’s specific needs.

Mr, Todd feels that Energyhelpline.com has a more refined approach to the concept of combined purchasing. He says they can also afford to take less commission from their customers than Which? because they already have the necessary technology in place and will be able to provide excellent service to their customers.

Concerns have been raised that the price negotiated won’t be any lower that what is offered by other comparison sites. Mark says what they want to do is offer their customers a choice of buying their energy as part of a group or as an individual. Essentially, consumers will be given a choice of what they feel is best for them.

It’s been said that if the Big Switch is successful it could actually backfire. It won’t be easy to switch suppliers for that many customers in one go. On average, in the UK, roughly 80 000 households switch suppliers each week. This is about a third of the number of households that have signed up with Big Switch.

A spokesperson for Which? says it’s a good thing to see that more of schemes of this type are being launched as it is rocking the energy market. It will aid customers in getting a better deal on their energy costs. They think people should join as many of these schemes as they can as this will enable them to get the best possible tariff plan.

Registrations for Big Switch closed at the end of March. The Huge Switch will open up for registration until the middle of the month so they’ll be able to spend a month (Mid April to mid May) on negotiations with companies.